Are you concerned ?
You can claim the reimbursement of the social security contributions that have burdened your assets for real estate gains realized in 2017 and 2018 and for other types of income (such as rents) shown on your 2017 and 2019 tax notices , if you are:
Case n°1: An active cross-border
You are residing in France but subjected to the social security legislation of the European country where you are working (European union or Switzerland): all incomes from your assets are concerned for the years mentioned above (lifetime annuity, rental revenues, capital gains from the sale of shares, capital gains on real estate, income from other investments etc.)
Case n°2: Non-resident
You are residing and working in another State of the EU (United Kingdom before Brexit, Benelux, Germany, Italy etc.) or in Switzerland – you are subjected to the social security legislation of this State and you have benefited from capital gains on real estate or have you earned rental revenues in France.
You are then entitled to claim the reimbursement of social security contributions that you paid.
How much can you recover ?
The amount you can get refunded corresponds to the total amount of the various social security contributions that you paid on your capital revenues between 2016 and 2018:
- 15,5% for social contributions paid in 2016 and 2017
- 17,2% for social contributions paid after the 1st of January 2018
For example, capital gains on a real estate sold in 2016 :
To this amount, should be added an interest for delay at the annual rate of 2,2%.
Why claiming a refund for the years 2016 to 2018 ?
Your right to obtain a reimbursement has been confirmed by the French justice by a decision of the Administrative Court of Appeal dated 31st May 2018 and confirmed by a decision of the European Union Court dated the 14th march 2019 !
This favorable decision is the outcome of a very long legal battle lead against France and is fully based on European community law which has a higher authority than French law.
The finance bill 2019 has adopted the abolition of the social security contribution with effect from 1 January 2019.
Article 26 of the Finance Bill has finally put an end to all these years of procedure by releasing taxpayers under other European social legislation social levies which they were wrongly paid so far on their income.
The attention of the taxpayers must however be drawn to the fact that this suppression is only valid for the future so that the tax administration will not spontaneously make any refund compared to previous years (2016 to 2018).
Taxpayers must take the initiative to initiate an action for reimbursement.
Clearly, the law will apply in time and for the future as follows :
- for property income and other capital income shown on the tax notice: from the 2019 tax notice – income for the year 2018 is no longer subject to the CSG / CRDS.
- for property sales: since January 1, 2019, real estate gains are no longer subject to CSG / CRDS social security contributions.
Attention: taxpayers will have to pay a new contribution, namely “prélèvement de solidarité” (solidarity levy) of article 235 ter of the CGI, at the rate of 7.5%.
Why should you act now ? / Deadline ?
Ever since the Decree No. 2013-643 of the 18th July 2013, a jurisdictional decision revealing the non-compliance of a French provision with a higher rule (European law) is no longer an event that opens a new deadline to file a claim.
In other words, it is advised not to wait – for the Conseil d’Etat or the European court of justice to settle the new scheme implemented by the Social Security Financing act for 2016 – to launch the procedure.
Claim deadlines are therefore those set by ordinary rules under Article R 196-1 of the tax procedure guide.
If you miss the deadline to start an action, it will be too late even if the final decision of the Conseil d’Etat will occur after the expiry of the deadline.
The claim deadlines are as follow:
As per the expiry of the deadline of 31th December 2019 for capital gains on real estate sold in 2017 and other capital revenues earned in 2016 (mentioned in the 2017 tax declaration), it is in the interest of taxpayers to take precaution and act quickly without waiting for the outcome of the proceedings.
In any case for the British citizens, it is highly recommended to file the claim up before the official date of Brexit.
Indeed, there is currently a risk for the British citizens to act on the basis of the European law after the Brexit because they won’t be part of the European Union any longer.
Why appoint us ?
The GOFFIN VAN AKEN law firm is composed of three multilingual lawyers and has in the past undertaken several actions in defense of non-resident or cross-border taxpayers in their relations with the tax or social administrations by obtaining positive results in courts.
How to file a claim ?
We have created a website dedicated to this action. The website for the csg crds refund explains the whole procedure and allows you to file a claim.
Do not hesitate to contact us for any question.